Robert Gannicott, Chairman and Chief Executive Officer stated:
A year on from our purchase of the Ekati operation, we continue to improve ore
production and recoveries as we develop new ore sources. The receipt of full
operating permits for the Lynx open pit development in less than a year from
application speaks better than words about the determination of a newly
empowered Government of the Northwest Territories to
effectively manage through
this transition and to support well planned resource development.

Diamond Market Sentiment at the very
important JCK Las Vegas show in June reflected the optimism of the US retail
market. Demand continues to be steady from China and is picking up from India.

First Quarter Highlights The first quarter of
fiscal 2015 marks the anniversary of the divestiture of the Companys luxury
business and the acquisition of the Ekati Diamond Mine. The Company is now
focused on delivering enhanced value from its world class diamond mines: an 80%
interest in the Ekati Diamond Mine and a 40% interest in the Diavik Diamond
Mine. The Company is well-funded and has a strong balance sheet.

Excluded from the Ekati sales recorded in the first quarter
2015 were estimated sales of $6.9 million of rough diamonds recovered from the
satellite material at the Misery South and Southwest kimberlite pipes, as this
material was excavated during the pre-stripping operations for the Misery Main
Pipe. The Company estimates that consolidated gross margin and EBITDA margin
would have been approximately 23.0% and 40.4%, respectively, if the carats sold
from material excavated from the Misery South & Southwest kimberlite pipes
were recognized as revenue.

Exploration expense of $9.0 million was incurred during the
first quarter ($1.0 million in Q1 2014). Included in exploration expense for the
first quarter is $8.7 million of exploration work on the Jay pipe within the
Buffer Zone at the Ekati Diamond Mine.

Two rough diamond sales were completed by the Company during
the first quarter. The third rough diamond sale of fiscal 2015, which commenced
in the last week of April and only finished in the first week in May, will be
included as one of the three sales in the second quarter of fiscal 2015. As of
April 30, 2014, the Company held rough diamond inventory with a market value of
approximately $285 million and total cash and cash equivalents of $328 million
($212.5 million of cash and $115.6 million of restricted cash).

Jay Project Update An improved plan for
mining the Jay kimberlite pipe, which simplifies construction and has a reduced
impact on the water and fish population compared to the initial plan, has been
introduced to the Northwest Territories regulatory bodies and the impacted
communities. Improvements to diamond prices and an improved understanding of the
geology of the kimberlite and surrounding rocks supports the mining of Jay alone
without the early support of the Cardinal pipe. The changes, which have been
received with enthusiastic support, reduce both the expected timeline and the
environmental footprint of the project. This gives enhanced assurance of the
release of ore from Jay in late calendar 2019 to meet the completion of the
current ore reserves. The Developers Assessment Report for the project will
be filed with the regulator in September this year in anticipation of
ministerial approval from the Government of the Northwest Territories in the
fall of next year.

Operational Summary The stronger than
expected production results at the Ekati Diamond Mine for the first quarter
reflect the Companys strategy for fully utilizing the processing plant
capacity, higher than expected grades in the reserve feed and an increase in
diamond recovery (primarily of smaller diamonds) due to operational improvements
to the processing plant implemented by the Company over the last 8 months. The
Company estimates that process plant improvements to date have increased the
recovered grade during the first quarter, albeit in predominantly smaller
diamonds, by approximately 15%.

Ore processing at the Diavik Diamond Mine was 11% ahead of plan
as a result of greater ore availability, higher mining rates and improved
equipment availability, equipment efficiencies and utilization of the processing
plant.

1The Q1 2014 amounts for the Ekati Diamond Mine
are for the period from April 10, 2013 (the date of acquisition by the Company
of its interest in the Ekati Diamond Mine) to April 30, 2013.
2 The Diavik Diamond Mine reports on a
calendar quarter, whereas the Ekati Diamond Mine reports to the Companys fiscal
quarter. For the three months ended April 30, 2014, the Diavik Diamond Mine (on
a 40% basis) produced 735,000 carats from the processing of 236,000 tonnes of
ore. The last month of this production is not included in the Companys first
quarter financial results, as the Company reports Diavik results on a one-month
lag.3 Grade adjusted to exclude Coarse Ore Rejects
(COR). COR is not included in the reserves and is therefore incremental
production.

1The Q1 2014 amounts for the Ekati
Diamond Mine are for the period from April 10, 2013 (the date of acquisition by
the Company of its interest in the Ekati Diamond Mine) to April 30, 2013.

2 Excluded from the Ekati sales
recorded in the first quarter 2015 were estimated sales of $6.9 million of rough
diamonds recovered from the satellite material at the Misery South and Southwest
kimberlite pipes, as this material was excavated during the pre-stripping
operations for the Misery Main Pipe. The Company estimates that the Ekati gross
margin and EBITDA margin would have been approximately 15.6% and 34.3%,
respectively, if the carats sold from material excavated from the Misery South
& Southwest kimberlite pipes were recognized as revenue.

1The Ekati prices do not reflect
the increased recovery of small diamonds from the improvements in processing so
as to be consistent with the Company's current reserve estimates. The rough
diamond price of the additional recovered small diamonds at Ekati is estimated
at between $70 and $100 per carat.

1 Assuming an average Canadian/US
dollar exchange rate of $1.10. 2 The guidance on
capital expenditures and cash costs of production for Diavik are for the
calendar year ending December 31, 2014; all others are for the fiscal year
ending January 31, 2015.

Had the Company sold only the last production shipped in
the first quarter, the estimated price based on the prices achieved in the
May 2014 sale, would have been:
Ekati Diamond Mine (100%)
approximately $281 per carat
Diavik Diamond Mine (40%)
approximately $120 per carat

Non-IFRS Measures The terms EBITDA, EBITDA
margin and cash cost of production do not have standardized meanings according
to International Financial Reporting Standards. See Non-IFRS Measures in the
Companys First Quarter Managements Discussion and Analysis for additional
information.

Conference Call and Webcast Beginning at
8:30AM (ET) on Thursday, June 12th, the Company will host a conference call for
analysts, investors and other interested parties. Listeners may access a live
broadcast of the conference call on the Company's web site at www.ddcorp.ca
or by dialing 866-515-2915 within North America or 617-399-5129 from
international locations and entering passcode 36919939.

An online archive of the broadcast will be available by
accessing the Company's web site at www.ddcorp.ca. A telephone replay of
the call will be available one hour after the call through 11:00PM (ET),
Thursday, June 26th, 2014 by dialing 888-286-8010 within North America or
617-801-6888 from international locations and entering passcode 66271254.

About Dominion Diamond CorporationDominion
Diamond Corporation is a Canadian diamond mining company with ownership
interests in two major producing diamond mines. Both mines are located in the
low political risk environment of the Northwest Territories in Canada.

The Company operates the Ekati Diamond Mine through its 80%
ownership as well as a 58.8% ownership in the surrounding areas containing
additional resources, and also owns 40% of the Diavik Diamond Mine. It supplies
rough diamonds to the global market through its sorting and selling operations
in Canada, Belgium and India and is the worlds third largest producer of rough
diamonds by value.

The above information was disclosed in a filing to the SEC. To see this filing in its entirety, click here.